As customer expectations and preferences evolve, brands need to boost their CX performance to meet the opportunities and challenges. But it takes more than just wanting a customer's focus.

To position their business to thrive, brands need to prioritize building customer experience frameworks and tech stacks, led by a unified vision, according to Adobe and Oxford Economics’ State of Digital Customer Experience report.

Businesses that prioritize customer experience will reap the rewards, the report found, as seen from the results of recent initiatives at Parsons Xtreme Golf (PXG), which specializes in customized golfing equipment.

Created by self-proclaimed golf nut and GoDaddy founder, Bob Parsons, PXG offers a tailored customer experience through its stores to drive sales. In building its CX framework, Bret Miller, head of PXG’s customer and market research, developed a 5-point satisfaction rating based on customer surveys from in-store experiences. 

PXG was able to show that for every point increase in satisfaction, it equated to an increase in the odds of a customer making a purchase. “We can now forecast when we make incremental improvements in customer experience to the actual incremental increase in sales,” Miller told CX Dive.

Utilizing its customer data is an integral part of PXG’s CX framework. This rich, valuable data is generated by embedding all of the customer surveys with historical customer transaction data to find potential service differences by product and service channel leading to churn and/or causing repeat purchases and loyalty.

It’s helped having a founder with deep tech experience who understands the need to use data to underpin business decision-making. 

“We know data is critical. The mission was to create the foundation of the business in a way where we can use data from the very beginning,” said Miller.

Data experts like Matthew Biboud-Lubeck, GM UK/EMEA for Amperity, who was head of customer data at L’Oreal in a previous role, know the key is having an accurate data foundation in place. 

This helps brands “derive more value from their best customers, while still identifying new customers who share the same attributes and potential spending power,” Biboud-Lubeck said.

Developing their data intelligence enables them to decipher the signals around shopping habits, preferences and how they interact with ads to tailor specific offerings and improve CX. “Through this, brands can drive revenue and continue to meet the needs of their customers,” Biboud-Lubeck explained.

Platforms and predictions

Data needs a tech platform, as the report noted, to power rich, actionable insights. PXG found adopting a customer intelligence platform the key to driving data-led decisions across its CX initiatives. 

When Miller joined PXG, he set his sights on metrics such as confidence in the likelihood of customers making purchasing decisions to demonstrate ROI for the investment. 

With the platform fully integrated across the business and strong, clean customer data based on survey feedback, he has been able to harness prediction tools to develop a strong predictive model, which his team has found to be accurate between 75% and 80% of the time.

While not all brands will be in the position of having such a deeply tech-savvy founder, Miller said the lesson is that CX leaders need to drive the initiatives and look for ways to demonstrate ROI and not just wait for the objectives to be set from the top-down.

“Proactively think of ways that you could show your own ROI, whether it's you personally or through a tech platform,” he said.

“While having a customer intelligence platform is the enabler to simply and easily power the customer research projects, it’s still critically important for the teams that own CX to be generating the stories behind the insights and translating those into meaningful metrics for the business,” he said.

Although there needs to be support at the leadership level, because that’s ultimately where the investment and tactical campaign decisions are approved, the ideas and initiatives need to come from the teams connected to the customer. 

“The tech allows you to do that at scale, but it’s essential to have the people in those positions who have the skill set to be able to do that. The winning combination is having the people skill-set with the power of a platform,” Miller added.

Metrics to measure CX success

A range of metrics can measure CX ROI, Biboud-Lubeck said: loyalty and retention, lifetime value, churn rate and brand reputation. However, it’s important to note that measuring CX ROI can be complex, and the specific metrics and methods used may vary depending on the industry, company size and objectives. 

“While ROI is a crucial metric, it should be considered alongside other CX metrics and qualitative insights to gain a comprehensive understanding of the customer experience's impact on your business,” Biboud-Lubeck told CX Dive.

While profit may not be the primary CX metric, which is typically meeting and exceeding customer needs and expectations, it’s the end result. “CX and profit are intertwined, with a strong CX often leading to improved financial performance over time,” he said.

The Adobe report found businesses that prioritize CX enjoyed higher rates of growth, lead generation, referrals, repeat business and profit per customer. Biboud-Lubeck believes customer retention and lifetime value will become life-or-death for brands as inflation and the ongoing economic crunch contain business investment and customer spending. 

“In this environment, customer experience is everything, and successful brands must understand what matters to their customers,” he said.

Progressive companies need to prioritize the value of long-term relationships, even though it might not contribute to immediate profit, according to Julie Geller, principal research director with Info-Tech Research Group.

“Metrics such as customer acquisition cost (CAC), referral rates and churn offer a more nuanced view of success,” said Geller.

“These indicators help businesses iterate their strategies to align with complex buyer journeys, ultimately leading to sustainable profitability through up-sell and cross-sell opportunities,” she added.

How CX strategies align with broader business goals

Business priorities need to be oriented around customer expectations, and this alignment needs to span the entire customer journey, the Adobe report found. 

“Whether it’s market penetration, customer retention, or up-selling, successful CX initiatives need to be aligned with broader business goals, all while ensuring buyers can execute their own journey, not the one the company thinks they should have,” Geller said.

A robust CX strategy is proactive rather than reactive, and builds on existing relationships while strategically fostering new ones, she added. 

Geller recommends businesses evaluate their technology stack for capabilities like personalization and intent and real-time segmentation, and to ensure the technologies align with organizational objectives. 

“Integrating CX initiatives with an account-based marketing motion, leveraging data, and continual iteration based on real-world feedback are essential steps. And a holistic view of the buying committee, which extends beyond decision-makers to account for non-linear journeys, is crucial for long-term success,” Geller said.

Businesses can’t ignore generative AI, either, with the Adobe research showing businesses deploying generative AI in their CX efforts are already seeing improvements in business performance and reputation — and in the quality of their data insights. 

“If AI's role in this process hasn't yet been considered, it's time to get on board,” Geller said.